Get out, Johor tells tech retreat inspired by US tycoon's 'tech Zionism'

Authorities in Johor have cancelled the business licence of a so-called digital community founded by a US-based crypto tycoon known for his pro-Israel stance, with a 24-hour notice to cease all activities issued by the Iskandar Puteri City Council (MBIP).

It comes days after Balaji Srinivasan's thinly veiled ultimatum to the Malaysian government to give assurances that his Network School can continue to operate, amid protests over allegations of the presence of dual-nationality Israelis as well as its links to pro-Zionist elements.

"The state government would like to emphasise that Johor always welcomes high-quality investments that benefit the economy, create job opportunities and drive the state's development.

"However, no investor, company or organisation can be placed above the rule of law," said Johor Menteri Besar Onn Hafiz Ghazi, adding that his administration fully supports the decision by MBIP.

Yesterday, Digital Minister Gobind Singh Deo said Network School had adhered to all procedures.

But Gobind, who visited the centre in April but later took down a social media post showing him posing for pictures with Srinivasan and endorsing the centre, said matters related to its business operations fell under the jurisdiction of the state authorities.

Network School, a co-living community in Johor's Forest City that attracts hundreds of digital nomads and entrepreneurs from around the world, has been embroiled in controversy following claims that it has allowed Israeli nationals with dual American citizenship to set up base there.

The concept is part of Srinivasan's vision of creating a "Network State", which he once compared to "tech Zionism".

Last week, immigration authorities conducted checks at Network School before clearing it of accusations that Israeli nationals were residing there.

In a lengthy reaction, Srinivasan dismissed critics who he said had hurled “sensational accusations”, and singled out a pro-Palestine social media account for spreading a “fake story”.

“If you don’t want our investment, or those of our colleagues at billion-dollar funds and trillion-dollar companies, we will of course respect your wishes and reallocate our capital to other countries instead,” he wrote, while announcing that all future plans were suspended “until we get sufficient assurance that such issues won’t recur”.

The remarks were condemned by an opposition politician, who warned Prime Minister Anwar Ibrahim’s government against being lured by promises of technology investment.

“This is no ordinary investment, it is a tactic to establish a ‘nation within a nation’,” said outspoken lawyer Rafique Rashid of Pejuang.

“Why are we so easily taken in by foreign money? Yes, investment is important, but the dignity and security of our borders are far more important.”

Network School was established almost two years ago and has evolved from a temporary set-up to a long-term residence for hundreds of people from around the world, who pay a monthly fee of just over RM6,000 for accommodation and other facilities.

The centre also hosts talks featuring many pro-Israel entrepreneurs such as Ethereum co-founder Vitalik Buterin and Brian Armstrong, the CEO of cryptocurrency firm Coinbase, which has made heavy investments in Israel.

Other speakers with political and business links to Israel include Ben Horowitz, Bryan Johnson and Anatoly Yakovenko, and more than a dozen others, according to its website.

Saying Johor acts as a strategic gateway bordering Singapore, Onn in his statement today urged the relevant federal authorities to take strict action if it was found that second passports were used to conceal the identity of Israeli nationals entering the country.

He said any weaknesses or abuses in the immigration system must be addressed immediately.

He also urged the digital ministry and its agency Malaysia Digital Economy Corporation (MDEC) to review the Malaysia Digital status accorded to Network School if it was found to have broken any laws.

“The state government will continue to work with all parties to ensure Johor remains a trusted destination for investment, without compromising the country’s security, sovereignty and laws,” said Onn, adding that Johor regent Tunku Ismail Sultan Ibrahim has been briefed on the matter.